European equities gained on Tuesday with interest rate-sensitive technology stocks leading the gains as a surge in US bond yields paused.
(Bloomberg) — European equities gained on Tuesday with interest rate-sensitive technology stocks leading the gains as a surge in US bond yields paused.
The Stoxx 600 Index was 0.7% higher by the close. Almost all sectors advanced, with the Stoxx 600 Technology Index up 2.0%, the most in almost a month. Real estate shares also rose by a similar amount.
The FTSE 100 gained 0.2%, ending its longest losing streak since July 2019. Ubisoft Entertainment SA jumped after signing a cloud streaming deal for Activision Blizzard Inc. games.
“This bit-by-bit correction over the last two weeks, accompanied by poor volumes, will continue until bond yields send signals toward another direction,” said Guillermo Hernandez Sampere, head of trading at asset manager MPPM. “The attractive fundamentals of many equities have not yet attracted investors to increase their positions.”
The main regional benchmark fell to a six-week low last week amid turmoil in China’s property and shadow banking sectors and because of worries interest rates will remain higher for longer. European shares are trading near their cheapest levels ever compared to Wall Street peers.
Investors are waiting for Federal Reserve chief Jerome Powell’s address on Friday as part of the Kansas City Fed’s annual symposium in Jackson Hole for clues about the central bank’s policy outlook.
For more on equity markets:
- European Equities Unable to Shed Their Cheap Tag: Taking Stock
- M&A Watch Europe: Irras, Entain, CMA Update on Microsoft Deal
- Turkish IPOs Become Inflation Hedge for the Masses: ECM Watch
- US Stock Futures Little Changed; Tingo Group, Citigroup Fall
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–With assistance from Farah Elbahrawy and Sagarika Jaisinghani.
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